Correlation Between Odfjell Technology and Grong Sparebank
Can any of the company-specific risk be diversified away by investing in both Odfjell Technology and Grong Sparebank at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Odfjell Technology and Grong Sparebank into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Odfjell Technology and Grong Sparebank, you can compare the effects of market volatilities on Odfjell Technology and Grong Sparebank and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Odfjell Technology with a short position of Grong Sparebank. Check out your portfolio center. Please also check ongoing floating volatility patterns of Odfjell Technology and Grong Sparebank.
Diversification Opportunities for Odfjell Technology and Grong Sparebank
-0.01 | Correlation Coefficient |
Good diversification
The 3 months correlation between Odfjell and Grong is -0.01. Overlapping area represents the amount of risk that can be diversified away by holding Odfjell Technology and Grong Sparebank in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Grong Sparebank and Odfjell Technology is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Odfjell Technology are associated (or correlated) with Grong Sparebank. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Grong Sparebank has no effect on the direction of Odfjell Technology i.e., Odfjell Technology and Grong Sparebank go up and down completely randomly.
Pair Corralation between Odfjell Technology and Grong Sparebank
Assuming the 90 days trading horizon Odfjell Technology is expected to under-perform the Grong Sparebank. In addition to that, Odfjell Technology is 2.77 times more volatile than Grong Sparebank. It trades about -0.05 of its total potential returns per unit of risk. Grong Sparebank is currently generating about 0.0 per unit of volatility. If you would invest 15,000 in Grong Sparebank on September 1, 2024 and sell it today you would lose (4.00) from holding Grong Sparebank or give up 0.03% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Odfjell Technology vs. Grong Sparebank
Performance |
| Timeline |
| Odfjell Technology |
| Grong Sparebank |
Odfjell Technology and Grong Sparebank Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Odfjell Technology and Grong Sparebank
The main advantage of trading using opposite Odfjell Technology and Grong Sparebank positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Odfjell Technology position performs unexpectedly, Grong Sparebank can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Grong Sparebank will offset losses from the drop in Grong Sparebank's long position.| Odfjell Technology vs. Shelf Drilling | Odfjell Technology vs. BW Offshore | Odfjell Technology vs. Subsea 7 SA | Odfjell Technology vs. Elkem ASA |
| Grong Sparebank vs. Odfjell Drilling | Grong Sparebank vs. Sparebank 1 SMN | Grong Sparebank vs. Norwegian Air Shuttle | Grong Sparebank vs. Dolphin Drilling AS |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Insider Screener module to find insiders across different sectors to evaluate their impact on performance.
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